Alamos Ready to Close Dubreuilville Mine Acquisition Deal

Argonaut Gold shareholders have approved a merger with Alamos Gold, paving the way for the consolidation of two gold mines in the Dubreuilville area of ​​northeastern Ontario.

In a news release, Toronto-based Argonaut Gold said an overwhelming majority (99.58 per cent) of shareholders approved the merger at a special general meeting of shareholders on June 28. Alampos is acquiring all of Argonaut’s issued and outstanding shares.

The two Toronto-based companies entered into a definitive agreement on March 27 under which Alamos will acquire all of the issued and outstanding shares of Argonaut in an all-sharing transaction valued at $325 million. Alamos and Argonaut shareholders will own approximately 95 percent and 5 percent of the combined company, respectively.

Alamos’ target in the deal was Argonaut’s Magino mine, which began commercial operation last November.

The two companies are neighbors in the Michipicoten gold belt. Alamos’s Island Gold underground mine and Argonaut’s Magino open pit mine are approximately 300 meters apart. Alamos sees significant synergies and cost savings from the acquisition, having access to Argonaut’s newer processing mine and is interested in exploring at depth at the Magino mine.

The deal is expected to become official on July 5, pending final approval by the Ontario Superior Court of Justice. Argonaut shares will then be delisted from the TSX.

Magino was considered Argonaut’s flagship acquisition.

The remainder of Argonaut’s mining assets in Mexico and the Florida Canyon mine in the U.S. will be spun off into a separate subsidiary that may be sold, although no agreements have been reached so far.